Citizenship Round-Up: Nine Trends from 2013

by Peter Spiro

Citizenship practice and policy is mostly below the news radar; change is slow; and the field tends not to be reported in any sort of integrated way. So here are the key threads from 2013 and how they might spin out in 2014.

1. Citizenship is not priceless. A growing number of states are selling citizenship. Malta is the latest. EU citizenship can be yours for 1.15mn Euros. Hungary, Spain, and Portugal now offer permanent residency in return for smaller investments in residential property, which can lead to citizenship in short order; and Cyprus tossed consolation passports to foreigners who lost more than three million Euros in the country’s banking collapse. The trend has been somewhat predictably lamented by liberal nationalists (see this forum, for example, on EUI’s excellent citizenship observatory site, with a lead contribution from Ayelet Shachar), but look for other states to cash in on a commodity that has no effective marginal cost. Will 2014 see a passport price war?

2. Even the Germans can live with dual citizenship. Americans will have a hard time understanding how big a flashpoint dual citizenship has been in German politics over the last 15 years. As a condition for remaining a part of Angela Merkel’s coalition after recent elections, Social Democrats secured the elimination of the so-called “option model” that had required German-born dual nationals to renounce one or the other by age 23. Dual Turkish-German citizens living in Germany are the big winners. If Germans can live with dual citizenship, any country can. Expect the dramatic trend towards acceptance of the status to move into its mopping up stage, with remaining holdouts (e.g., Japan) giving up their old-world jealousies.

3. American no more. 2013 saw a continued uptick in the number of individuals renouncing U.S. citizenship, with Tina Turner following in the footsteps of Facebook co-founder Eduardo Saverin, along with thousands of ordinary Americans living abroad. Taxes supply the clear motivation, as much the burdensome administrative requirements imposed by the Foreign Account Tax Compliance Act (FATCA) as the payment obligations themselves. Expat websites are aflame with outraged citizens ready to cut the cord. Expect this story to get closer to the front burner as FATCA enforcement kicks in during 2014. Do external Americans have enough political clout to repulse this IRS juggernaut?

4. Foreigners have privacy rights, too. In the NSA’s massive post-9/11 surveillance apparatus, it was open season on non-citizens outside the United States. With good jurisprudential reason: the Supreme Court (in Verdugo-Urquidez) squarely held that non-resident foreigners have no Fourth Amendment rights against the U.S. government. But that understanding is under pressure from other quarters. There’s the prospect of an international right to privacy. That won’t have much effect on America’s spymasters, at least not in the short run. The President’s NSA review board might be more influential. Its recent report called for substantial limitations on eavesdropping on foreigners (see pages 155-56). It will be interesting to see whether Obama buys in.

5. A human right to citizenship. The Dominican Republic came under withering human rights fire after its Supreme Court declared Dominican-born individuals of undocumented parents (almost all Haitian) not to enjoy Dominican citizenship. The ruling leaves 200,000 effectively stateless. Those crying foul included the major human rights groups, the UN, major powers, the Caribbean Community, and the Dominican diaspora. Expect the DR to reverse course during the coming year or face some material consequences. Other states are also coming under increasing scrutiny for rights-problematic citizenship practices. The Gulf States are getting more bad press for their notoriously ungenerous naturalization laws. Notwithstanding significant goodwill in the wake of the transition to democracy, Burma is not getting a free pass on its continuing refusal to facilitate citizenship for the Rohingyas. Human rights-based citizenship claims are clearly on the upswing, a context in which sovereignty once supplied a trumping defense.

6. Obama’s gives up on The New Citizenship. President Obama centered citizenship as a theme in a number of high profile speeches, including the trifecta of his nomination acceptance speech, his second inaugural address, and the State of the Union. In his words, citizenship “describes the way we’re made. It describes what we believe. It captures the enduring idea that this country only works when we accept certain obligations to one another and to future generations.” Lofty rhetoric, but nobody seemed to notice. Don’t expect any more stabs at this one. Much as he would like it to, this will not go down as the defining label of the Obama Presidency.

7. Ted Cruz may be a Canadian, but he is eligible for the presidency. There’s a delicious irony in the fact that the candidate most attractive to Obama-obsessed birthers himself has a much bigger question-mark relating to presidential eligibility. But even though Ted Cruz was born in Canada (and holds Canadian citizenship as a result), he is almost certainly eligible to run for president as a “natural born” U.S. citizen, holding citizenship at birth through his mother. Cruz says he has applied for termination of his Canadian citizenship. Expect the questions to linger if his candidacy looks viable; it’s just too easy a poke in the Tea Party gullet.

8. The path to legal residency matters more than the path to citizenship. At least among those affected, namely, 11-13 million undocumented aliens in the United States, as evidenced in a Pew Hispanic Center poll and reported by Julia Preston in a NYT story here. This can’t be surprising, since the main drawback of being out of status is locational insecurity. So why the persistence of the popular political tagline, “a path to citizenship”? It plays better for political proponents of regularization by lending their agenda a high-minded civic orientation. It also seems required by American notions of equality: we can’t just give undocumented aliens permanent residence insofar as it would offend baseline equality norms. Could reform advocates cave on this in 2014 if it presents the only path to a deal? Maybe.

9. Recementing ties to long-lost brothers and sisters. Spain followed through on its 2012 promise to extend citizenship to descendants of Sephardic Jews expelled from Spain half a millennium ago. Though meaningful ties persist (including in a still-living language spoken by Sephardi), one might wonder if the Spanish government was looking to capitalize on somewhat tenuous ties to its economic advantage, granting citizenship to nonresidents at the same time residents (Moroccans, for example) face significant obstacles to naturalization. More controversially, Hungary moved ahead with policies to extend citizenship — and the vote — to nationalistic co-ethnics in neighboring Slovakia and Romania supportive of the right-wing government in Budapest. Look for more countries to strategically relax requirements for citizenship by descent as they increasingly see diaspora populations as an economic and/or political resource.

6 Responses

Very interesting post on citizenship trends, thank you. I am writing an essay right now on the dominican citizenship law. In your post you say “Expect the DR to reverse course during the coming year or face some material consequences.” What material consequences do you think they could face?

12.27.2013
at 11:40 am EST JNB

Fair question. I suspect the issue may be important enough to trigger conditionality in some contexts, in other words, that it will be on the table when the DR is asking for international benefits of one description or another.

Thanks, I’m curious about what the international community can do to put more pressure on the DR about this issue. So far I’ve found a lot of condemning statements by intl orgs, courts and govts and only one concrete consequence, CARICOM is suspending the DR’s membership application http://www.globalpost.com/dispatch/news/afp/131126/caricom-slams-dominican-republic-ruling-stripping-citizenship-rights. Will be interested to see what more happens this year.

12.27.2013
at 3:53 pm EST JNB

Interested in your thoughts on this which is a comment to a Robert Wood article:

Particularly the suggestion that dual citizens, when in the country of one citizenship, should be treated as thought they are solely the citizens of that country.

The estimates of US citizens abroad, never mind “US Persons” including present and former green-card holders and even deportees with prior long US residence, are so vague and politicized as to be unhelpful for the analysis of tax noncompliance and revenue potential. Until 2011 the State Department used a working estimate of around 4 million; without explanation they are now proposing the number put forward by American Citizens Abroad, a Geneva-based organization, of over 6 million. The GAO and the Department of Commerce have opined that a census of US citizens abroad is impractical.
From published statistics we know there are 113.4 million valid US passports. From time to time the State Department has published statistics on numbers of passports applied for from abroad; it does not, however, publish the contents of F-77 reports prepared by embassies on the “Estimated Number of Potential Evacuees” (see 7 FAM 040). Numerous countries report the number of US citizens registered as aliens, but this would not include persons also holding the nationality of that country or, within the EU/EEA/Switzerland of a member state. Nor would it include those persons born abroad to one or two American citizens whose birth was never registered with the Department of State for whatever reason, including doubt as to the requisite prior U.S. residence of a parent.
To publish a scare article about the “Global Reach” and the “Very Long Memory” of the IRS is unhelpful. With only five overseas attachés and an obvious priority for collection cases that will yield revenue, the IRS is unlikely to pursue those with few or no ties to the USA nor any assets or heirs there, but who may have a claim to US nationality. Many such persons will not be caught by FATCA because their US connection is so tenuous. Others, who may have no unpaid tax but longstanding failure to declare foreign accounts and, worse, educational or disability trusts, pensions in a non-treaty country and PFIC issues might well be bankrupted by IRS claims. Assuming the abolition of the Lord Mansfield “Revenue Rule”, the cost of compliance for many is astronomical, even impossible.
If there are really 6 million Americans abroad and only a few hundred thousand tax returns filed from foreign addresses, then FATCA and threats of penalties and prosecution — even assuming that nonfiling is assimilated to tax evasion and, with OECD support tax evasion to extraditable common-law fraud and money laundering — are not going to lead to a solution. Are we to expect that the kind of grey-haired grannies that I talk to on this subject should really quake in fear and rush to renounce their citizenship? Are we to think that the IRS will arrogate to itself the State Department and Immigration Courts’ role of determining who are American citizens and US Persons?
I neither seek new clients nor prepare tax returns. But I do hear stories, and I see that American citizens abroad are being denied bank services and that some, nationals also of the country where they live, are demanding to be treated, as public international law provides, as solely the nationals of the country of dual nationality where they reside. I wonder how long it will be before countries, while willing to give up their banks to the USG, aren’t willing to have their grannies threatened by a foreign country. I suspect we will see some countries at least take up their grannies’ claims to be protected from cross-border bullying.
For all the understandable eagerness of tax lawyers to assist those in irregular status — presumably chiefly the US residents among them — to resolve their noncompliance, I detect few or none eager to provide pro bono advice to the expatriate poor.

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